First-Time Entrepreneurs Should 'Listen To The Yodas'

Jim Price is a serial entrepreneur and business educator. He’s launched and led several tech-enabled businesses, and achieved successful exits through multiple company sales and an IPO. For the past decade, Jim has also held a faculty position at the University of Michigan’s Ross School of Business, where he also serves as an Entrepreneur in Residence at the Zell Lurie Institute for Entrepreneurial Studies.

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Something I love to do when I get a chance is help friends who are starting businesses, particularly first-time entrepreneurs.

I listen to their vision, how they’re approaching solving their customers’ pain, where they are in the company development process, and I give them simple, honest feedback.

But I know I don’t have all the answers. (In fact, the more I learn, the more I realize I don’t know. It’s to the point where I’m asymptotically approaching being the dumbest person in every room I enter.)

Something, though, that’s proven personally useful to me as I build my own businesses – and therefore something I try to arrange for startup teams I’m advising – is to meet informally with experienced entrepreneurs in that particular market space and listen to the yodas.

Even the most talented entrepreneurs, especially at the early stages, tend to get so immersed in what they’re doing that it’s as if they’re enveloped by a thick ground layer of fog. It’s tough to see much beyond what you and your immediate team are doing and thinking. If you’re willing to listen, meeting with someone who’s built and run a company in your market space is like flicking on a turbo fan and sucking all the fog from the room.

You know you should be talking to customers, for instance, but which customers? And how should you approach them to garner the most useful feedback?

You’ve been considering this business model, but the yoda you’re chatting with says, 'Have you considered this other business model that your target customers will more readily accept? It’ll shorten your sales cycle.'

You’re assuming such-and-such is the obvious initial target market, but your yoda mumbles something offhandedly about a more promising market segment you hadn’t even considered, and explains why it’s so compelling.

And of course, each wise one you meet with may have others in your industry he’s willing to refer you to. Personal referrals open doors.

The meetings may be brief and the advice succinct – such people have plenty of demands on their time, and they didn’t get where they are by being longwinded. But prosper you will from listening to the yodas.